The U.S. Securities and Exchange Commission has charged Texas oil company Norstra Energy, its CEO, and the author of a stock-picking newsletter with misleading investors about the firm’s oil reserves and business prospects.

Stock-picker Eric Dany was allegedly hired to help promote Norstra shortly after Glen Landry took over as the company’s CEO in March 2013. In a civil complaint filed Thursday, the SEC said promotional materials issued by Dany falsely proclaimed that “Norstra Energy could be sitting on top of as much as 8.5 billion barrels of oil!” and said its planned wells had a 99% chance of profitability.

After Dany and Landry made their “exaggerated” statements in press releases and regulatory filings about Norstra’s ability to find and produce oil, the SEC said, the company’s stock rose from $0.35 per share on March 5, 2013 to $2.06 a share on June 6, 2013. The SEC suspended trading in the shares on June 26, 2013.

“When microcap companies appear to be misleading the investing public, the SEC investigates those promoting the stock as well as the culpability of company officers,” Michael Paley, co-chair of the SEC Enforcement Division’s Microcap Fraud Task Force, said in a news release.

“We allege that as a longtime geologist, Landry was well aware that Norstra Energy did not have the oil reserves or drilling plans being touted to investors,” he added. “And as a self-proclaimed expert in oil-and-gas stocks, Dany knew that claims made about the company were false but touted the stock anyway in a spam e-mail campaign and a hard-copy mailer he was paid to endorse.”

According to the SEC, Dany has proclaimed that his “forté is being early to dig up the next big winner in the natural resources sector.” The SEC said he was retained by an advertising company to endorse Norsta in a “spam” email campaign and a 16-page hard-copy mailer, receiving $20,000 for his services.

“As approved by Dany, the promotional materials recommended that investors purchase Norstra based on Dany’s wildly optimistic projections about Norstra’s future prospects,” the SEC said.